posted at 1:25 pm on September 19, 2011 by Ed Morrissey

With their entire economic approach under fire after the collapse of Solyndra — and no small amount of speculation as to the motives behind the Obama administration’s approval of over a half-billion dollars in subsidies for the solar-tech flop — the White House has launched their own investigation into Solyndra’s failure. Are they looking at their own decision to sink tens of billions of dollars into a decades-old industry that has never produced a return on such subsidies before? No, they’re looking to blame China for, er, doing exactly what Obama did in 2009 (via Jimmie Bise):

The Department of Labor has become the latest federal agency to open an inquiry into the bankruptcy of Solyndra, the solar panel manufacturer in Fremont that President Obama once hailed as “a testament to American ingenuity and dynamism.”

But unlike the inspectors general of the Energy and Treasury Departments and the Federal Bureau of Investigation, who are looking into possible wrongdoing in connection with the company’s $527 million federal loan, the Labor Department is examining a more prosaic economic question: Did Solyndra’s workers lose their jobs because of competition from China? …

The inquiry was set in motion in response to a petition filed by Alameda County under the little-known Trade Adjustment Assistance Program, which provides for additional benefits to American workers when their jobs are lost to foreign trade. In the petition, Patti Castro, the interim director of Alameda County’s Workforce Investment Board, said that “Solyndra and other U.S. solar industry manufacturers have been affected by a worldwide plunge in solar cell prices, based in part on huge subsidies Chinese solar manufacturers receive from their government.”

According to the Department of Energy, solar panel prices have dropped 42 percent since January, largely because of $30 billion in Chinese government subsidies to its solar sector. The United States share of the worldwide solar-panel market has fallen from a peak of 43 percent in 1995 to just 7 percent last year.

China floated $30 billion in subsidies to its solar sector? Wow, that’s so totally unfair. Why, the US would never stand for such a thing! That’s why Obama included almost $40 billion in green-sector subsidies as part of his 2009 Porkulus package, of which $17 billion has already been spent. And let’s not forget that over a half-billion dollars of that money got spent specifically on Solyndra alone.

To call this hypocrisy undersells the laugh factor. This is nothing less that chutzpah, as well as a strange sort of xenophobia in laying the blame at the feet of the Chinese for this administration’s decision to invest in a fiscally unsound enterprise like Solyndra. China didn’t force Obama to expedite the approval of Solyndra’s loan application over the objections of internal and external auditors. Hilda Solis now want to make an argument that China’s subsidies were inherently unfair, while ours were — what? Merely incredibly stupid, and possibly corrupt?

The corruption comes from the proximity of Obama donor George Kaiser to the Solyndra sinkhole. Kaiser was one of Solyndra’s big investors, and the Obama administration restructured its loans late in the game to favor Kaiser in a bankruptcy. Kaiser and his Solyndra colleagues were frequent visitors to the White House, which raises questions about the administration’s efforts to steamroll auditors in getting a quick approval of the loan. The Daily Caller reports today that Kaiser may have been sweetening the pot a bit by dropping some big money into the coffers of a charity favored by the Obamas:

A Daily Caller review of the George Kaiser Family Foundation’s income tax returns found that during the same year billionaire investor George Kaiser successfully secured $535 million in government loan guarantees for the now-failed solar panel manufacturer Solyndra, his private philanthropy donated to a political cause close to the hearts of several high-ranking Obama administration officials.

Kaiser, a major Obama donor, was a frequent White House visitor during the week before the Obama administration approved that taxpayer-underwritten financial deal.

A $10,000 donation to the Urban Health Initiative at the University of Chicago Medical Center appears on the group’s 2009 tax forms. It was also in 2009 that Kaiser successfully sought to lock down a loan guarantee for the green-energy company Solyndra through his two investment vehicles: Argonaut Ventures and the GKFF Investment Company.

While this donation seems small compared to the far larger numbers involved in the Solyndra scandal, it adds to the pattern of possible connections between the Obama administration and the growing Solyndra scandal.

It certainly appears that Kaiser intended to curry favor inside the White House at just the same time that the administration pressed the DoE to approve loans to the already-stumbling Solyndra. And no matter how much this administration attempts to blame China, the focus of Solyndra will remain on the administration who threw away a half-billion dollars in taxpayer money to help out a big campaign donor.

For some reason it reminds me that the biggest boogeyman the National Socialists ever had was the communists. The Germans didn’t really want to fight the Brits or the Americans…. they wanted to get those commies good!

Goldman was the main underwriter/adviser…… I think they were exclusive in the role of adviser in the DOE deal and in the proposed IPO. They were also very heavily involved in the larger private equity raises.

On the Obama Plant Visit

With a heavy dose of ironic twists, the WH approaches Upper Management telling them that they would be very interested in a trip by the President. Do you tell them “no, our CEO is headed out the door, and we are *not* going to let you showcase the completion of our Fab that *you* helped pay for?”……. The entire Presidential trip was a rush undertaking, I think there was only about 1.5 weeks between the request and the trip.

Did insiders understand what was happening?

Trouble was brewing a year and a half ago with the first “massive wipeout” equity round, and when Chris Gronet was consigned to a figurehead role in Feb of last year. The co. was run between Feb and June by a triumvirate of Stover (cfo), Gaffney (GC), and (damn i forgot the name of the sales VP who bolted to the roofing company in texas…… was it Kirk Roller?)

Was there a “surprise” collapse at the end? Who walked?

I am very aware that this second funding was being worked on feverishly all the way up until the night before the “mass layoff”. In fact, just a week before the deal was described to me as being in the bag, as to *everyone* on all sides of the deal.

You’re telling me that the PRC is willing to tax its own people to give subsidies to solar manufacturers, who will turn around and sell us energy producing capacity at below market rates, to any US citizen willing to purchase?

Kaiser was one of Solyndra’s big investors, and the Obama administration restructured its loans late in the game to favor Kaiser in a bankruptcy. Kaiser and his Solyndra colleagues were frequent visitors to the White House, which raises questions about the administration’s efforts to steamroll auditors in getting a quick approval of the loan.

The inquiry was set in motion in response to a petition filed by Alameda County under the little-known Trade Adjustment Assistance Program, which provides for additional benefits to American workers when their jobs are lost to foreign trade.

This is the global problem though.
We have to subsidize things, cuz if we don’t our products will be too expensive in other markets because they are subsidized over there.
It’s a huge, global circle jerk. You’d think someone would try to get a handle on it somehow.
lorien1973 on September 19, 2011 at 1:32 PM

It’s really the same problem as tariffs, just with the cash flowing differently. In the end, it still has the same damaging effects on tottal global productivity.

You’re telling me that the PRC is willing to tax its own people to give subsidies to solar manufacturers, who will turn around and sell us energy producing capacity at below market rates, to any US citizen willing to purchase?
Who exactly has a problem with this?
JohnGalt23 on September 19, 2011 at 1:39 PM

Well, there are more usefull things they could be…
Actually, it is kind of win-win, isn’t it?

To call this hypocrisy undersells the laugh factor. This is nothing less that chutzpah, as well as a strange sort of xenophobia in laying the blame at the feet of the Chinese for this administration’s decision to invest in a fiscally unsound enterprise like Solyndra. China didn’t force Obama to expedite the approval of Solyndra’s loan application over the objections of internal and external auditors. Hilda Solis now want to make an argument that China’s subsidies were inherently unfair, while ours were — what? Merely incredibly stupid, and possibly corrupt?

It certainly appears that Kaiser intended to curry favor inside the White House at just the same time that the administration pressed the DoE to approve loans to the already-stumbling Solyndra.

Kasier said he did no such thing.

All he did was stop by to ask about phone numbers … his hirelings’ secretaries could dial Obama’s hirelings’ secretaries… so that the hirelings could arrange lunch … outside the government environment … so they could curry favor for him.

One has to respect the avoidance of the appearance of conflicts of interest lest a crime be alleged.

Goldman was the main underwriter/adviser…… I think they were exclusive in the role of adviser in the DOE deal and in the proposed IPO. They were also very heavily involved in the larger private equity raises.

The absurdity of industrial wind/solar just got even more absurd in PA with an application to FERC from Symbiotics, a Utah Company, to put in a pumped-storage system in Blair County, PA, to smooth out the erratic power from wind turbines. To smooth out wind energy, the facility will pump water uphill (when the wind blows) for storage until the wind stops blowing, when the water will be released downhill to generate electricity. The article below shows that this renewable push is allowing companies to further destroy natural habitat by adding pumping stations with reservoirs – which use MORE electricity than they produce – to wind farms.

You’re telling me that the PRC is willing to tax its own people to give subsidies to solar manufacturers, who will turn around and sell us energy producing capacity at below market rates, to any US citizen willing to purchase?

Actually I don’t think they got the money by taxing their citizens, I think they got it by cashing the checks for interest payments from the U.S. Treasury.

Apparently, in the mold of JFK, Obama today is claiming that there is a “gap.” Oh, not a “missile gap” like JFK, but rather a “solar subsidy gap.”

Seems the Chinese government has invested $30 billion in solar panel technology, while poor Obama was ony able to scratch together $40 billion (plus another $17 billion already in the pipeline) for solar panel technology from people like Solyndra. Even thought the Chinese also have a built in amount of graft from party officials, it seems that US politicians require a larger portion of subsidies to go to official political and private sector graft.

The solar industry is one area where we still have a trade surplus with China. Solyndra’s market was dependent on silicon prices remaining high (their product is silicon light) but the market collapsed and silicon is very cheap so their product was uncompetitive. Important details are being left out of this story.

With their entire economic approach under fire after the collapse of Solyndra — and no small amount of speculation as to the motives behind the Obama administration’s approval of over a half-billion dollars in subsidies for the solar-tech flop — the White House has launched their own investigation into Solyndra’s failure.

Obama: “No, officer, those aren’t mine. I’ve never seen those before. What? By the road? Nah, I never tossed anything by the road, but I bet China did.”

Biden: selected as V.P. because he is nuts, bonkers, gone on safari, out to lunch, a nitwit, craaazee.

He also helps keep the critical focus off Obama among certain “dedicated Democratic voter” groups, people who actually believe Biden makes sense by one association or another those groups will.not.question.

If we, as a whole, can get this stuff cheaper from China than it costs to make it ourselves, that is a net gain for our country, and frees more of us up to do other things. The Chinese here are in fact subsidizing our purchases!

Used to live in Fremont and drive by the Solyndra plant every day. They had guys working on building that place literally 24/7 – as it was going up all I could think about was the ruinous cost of construction on that building. Now I know to whom it was ruinous – Me!

If I understand the economics right, the Chinese are using subsidies to undercut our prices, but isn’t the real problem that their currency doesn’t float on the global markets? I have it in my head that reports state that the Yuan is 25% or more under-valued. Just find a way to stop that and all of a sudden we (or the Europeans or anyone who isn’t China) become much more competitive in a large variety of things.

I would love to cut off all of our crony-capitalist subsidies, but then throw a tariff on Chinese goods to make up the difference in currency values until they let the Yuan float. Yeah, I know about the evils of tariffs, but why not do it now? If it forces the field to be level and open, allowing the real comparative advantages to come out, is that a bad thing? It’s not like the Chinese are going to buy any more bonds anyway.

Why would we want to force our people to pay higher prices for goods that not only can the Chinese produce cheaper than us, not only is the Chinese government willing to subsidize the industry so they can sell those panels to us even further below market price, but they are willing to use monies that otherwise could be spent for all sort of nefarious (or non-nefarious… who knows) Chinese schemes?

If the Chiinese government wants to pay to put solar cells on the US power grid, I say go fo it!!

If we, as a whole, can get this stuff cheaper from China than it costs to make it ourselves, that is a net gain for our country, and frees more of us up to do other things. The Chinese here are in fact subsidizing our purchases!

Tzetzes on September 19, 2011 at 3:00 PM

that’s the basic idea of Adam Smith, but trust both parties to screw up the free market such that the interest on our borrowing from China subsidizes our cheap prices for consumer items. Bet the real cost is more expensive than just paying full market value for the same products if made at home.

Governments are awful at picking winners and losers… China has been subsidizing gasoline for decades which was great for their government when prices were low but now… now it is solar in the US just like it was wind power in Spain…

The government is buying tulip farms just before their markets crash. And blaming the other guy for buying a smaller farm and undercutting him… it isn’t the amount of the subsidy but the movement of the market you nitwit President.